When is the German IFO survey and how it could affect EUR/USD?

The German IFO Business Survey Overview

The German IFO survey for July is lined up for release later today at 0800 GMT. The headline IFO Business Climate Index is expected to drop to 97.1 versus 97.4 previous.

The Current Assessment sub-index is seen weaker at 100.4 this month, while the IFO Expectations Index – indicating firms’ projections for the next six months – is likely to arrive at 94.0 in the reported month vs. 94.2 last.

Deviation impact on EUR/USD

Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 3 and 40 pips in deviations up to 2.4 to -3.2, although in some cases, if notable enough, a deviation can fuel movements of up to 60 pips.

 How could affect EUR/USD?

The spot looks to extend the recent bearish momentum towards the 1.1100 psychological level on downbeat IFO indicators while the EUR/USD pair could retest the 1.1150 immediate upside barrier on a positive surprise.

According to Haresh Menghani, Analyst at FXStreet, “From a technical perspective, the pair on Wednesday just managed to defend the 1.1130-25 immediate support, which should now act as a key pivotal point for short-term traders. Below the mentioned zone, the pair is likely to accelerate the slide towards challenging yearly lows - around the 1.1110-05 region, before eventually dropping to test the 1.1000 round figure mark in the near-term with some intermediate support near the 1.1070 area.”

“On the flip side, the 1.1150-55 region now seems to act as an immediate hurdle, above which a bout of short-covering might assist the pair to surpass the 1.1190-1.1200 horizontal support break-point turned resistance and aim back towards testing the 1.1270-80 heavy supply zone – nearing 100-day EMA,” Haresh adds.

Key Notes

ECB Preview: 11 Major Banks expectations from July meeting

EUR Futures: bearish view unchanged so far

Intra-Day News and Views & data to be released today - EUR/USD

About the German IFO Business Climate

This German business sentiment index released by the CESifo Group is closely watched as an early indicator of current conditions and business expectations in Germany. The Institute surveys more than 7,000 enterprises on their assessment of the business situation and their short-term planning. The positive economic growth anticipates bullish movements for the EUR, while a low reading is seen as negative (or bearish).